The High Court has refused AIB Leasing Limited’s application for summary judgment of €92,496.09 against Niall Quin, one of two former directors of Colinwell Systems Limited, and sent the dispute to a plenary hearing.
In a judgment delivered on 13 November 2019, Mr Justice Barr said Quin had raised an arguable defence to the claim under a guarantee and indemnity he signed in connection with a 2008 leasing agreement. The judge made no finding on whether the transaction was a sham or whether any alleged misrepresentation occurred.
AIB Leasing said the company leased goods for fitting out a new showroom and defaulted on payments. It argued that Quin and fellow director Peter Cantwell had signed the leasing agreement and personal guarantees. Cantwell consented to judgment for €92,429.09 in March 2016; no costs order was made against him.
Quin disputed the account. He said he did not know the goods listed on an invoice were stock for ordinary sale until the proceedings, and alleged the arrangement was a means of providing working capital dressed up as a lease. He also denied signing the agreement in the presence of AIB Leasing employee Sandra Hempenstall, who said she witnessed his signature and explained the agreement.
Gerard Gill, the company’s former office and accounts manager, supported Quin’s account of the signing. Gill said Quin was away when Hempenstall brought the documents to the company office, and that he left the agreement on Quin’s desk for him to sign later. Gill also said the agency agreement, dated November 2007, was created later, and that the €120,714.17 figure was assembled from invoices in April 2008. Hempenstall disputed those claims.
Justice Barr said the conflicting evidence about the signing, the agency agreement and the nature of the invoiced goods could not be resolved on affidavits alone. He considered there was substance to the concern that the agency agreement’s handwritten sum could not have been entered in November 2007, given that it drew on later invoices. Oral evidence would also be needed about whether the goods were showroom equipment or ordinary stock.
The judge rejected AIB Leasing’s submission that a possible sham lease could not provide a defence to the indemnity claim. He said the authorities on misrepresentation meant he could not conclude that, if Quin’s account were established, he would have no arguable defence.
The court refused summary judgment and remitted the case to plenary hearing. It directed AIB Leasing to deliver a statement of claim within four weeks, with Quin to deliver a defence within four weeks after receiving it.